Correlation Between Britvic PLC and Proximus
Can any of the company-specific risk be diversified away by investing in both Britvic PLC and Proximus at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Britvic PLC and Proximus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Britvic PLC ADR and Proximus NV ADR, you can compare the effects of market volatilities on Britvic PLC and Proximus and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Britvic PLC with a short position of Proximus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Britvic PLC and Proximus.
Diversification Opportunities for Britvic PLC and Proximus
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Britvic and Proximus is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Britvic PLC ADR and Proximus NV ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Proximus NV ADR and Britvic PLC is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Britvic PLC ADR are associated (or correlated) with Proximus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Proximus NV ADR has no effect on the direction of Britvic PLC i.e., Britvic PLC and Proximus go up and down completely randomly.
Pair Corralation between Britvic PLC and Proximus
Assuming the 90 days horizon Britvic PLC ADR is expected to generate 0.53 times more return on investment than Proximus. However, Britvic PLC ADR is 1.88 times less risky than Proximus. It trades about 0.07 of its potential returns per unit of risk. Proximus NV ADR is currently generating about -0.01 per unit of risk. If you would invest 1,915 in Britvic PLC ADR on November 27, 2024 and sell it today you would earn a total of 1,036 from holding Britvic PLC ADR or generate 54.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 87.58% |
| Values | Daily Returns |
Britvic PLC ADR vs. Proximus NV ADR
Performance |
| Timeline |
| Britvic PLC ADR |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
| Proximus NV ADR |
Britvic PLC and Proximus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Britvic PLC and Proximus
The main advantage of trading using opposite Britvic PLC and Proximus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Britvic PLC position performs unexpectedly, Proximus can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Proximus will offset losses from the drop in Proximus' long position.| Britvic PLC vs. Flow Beverage Corp | Britvic PLC vs. Barfresh Food Group | Britvic PLC vs. Fbec Worldwide | Britvic PLC vs. Greene Concepts |
| Proximus vs. Singapore Telecommunications Limited | Proximus vs. Telstra Limited | Proximus vs. MTN Group Ltd | Proximus vs. Tele2 AB |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the CEOs Directory module to screen CEOs from public companies around the world.
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